Did the July housing report showing a July decrease of 27% from 2009 scare you? Are you worried about foreclosures being dumped on the market?

Consider this: July, 2010 results for central Ohio were artificially low because the tax credit pushed sales forward for many buyers. In fact, some studies show that 3 out of 4 buyers would have bought without the tax credit. That means the credit just pushed sales forward a few months.

July, 2010 Sales YTD for central Ohio are up 11.4% from 2009, which is a positive. Unemployment has dropped from 10 to 9% in central Ohio and we are seeing many more relocation buyers in central Ohio. That means the corporate world is feeling better about the local economy.

Prices are up 2.8% YTD from last year but still below 2007 levels for most properties. The benefit to you is that if prices are down 10%, you save $40,000 on your new $400,000 house and only lose $20,000 on your old $200,000 house – a net gain of $20,000.  Plus, interest rates are the lowest in 30 years. You know that interest rates won’t stay this low forever….

Here are the lastest sales statistics courtesy of the Columbus Board of Realtors. 

Wondering if the $8,000 First Time Home Buyer Tax Credit is having an effect?

Consider this:

The typical first time home buyer will spend less than $200,000 for their home. In the Dublin, Hilliard, Olentangy and Upper Arlington school districts, there are 781 homes for sale under $200,000 as of September 25, 2009. There were 326 homes sold in that price range just in the last 60 days and another 212 in contract. At that pace, there is less than 5 months worth of inventory - a definite seller’s market. In fact, the average days on the market in that price range is only 86 days for sold properties.

Compare that to the high end market:

There are 525 homes for sale over $500,000 in the same Dublin, Hilliard, Olentangy and Upper Arlington school districts as of September 25, 2009.  In the past 60 days, 48 have sold. That is 21 months of inventory.

The Conclusion:

The changes reported in the August Residential Home Sales report are not necessarily consistent across price points. Inventory is down, but primarily in the lower price points. Sales are down, but not in the <$200,000 price point. Inventory is down 14%, but again much of that is in the lower price range. The First Time Homebuyers Tax Credit is scheduled to expire November 30. That means smart buyers will push to find a home as fast as they can, especially if they plan to use FHA financing. FHA loans are currently taking 45 days from contract date to closing. That means buyers may already be too late to find the home of their dreams and get the $8,000 tax credit. My guess is that December 1st will bring a lot of unhappy buyers who weren’t able to close in time.

Who will they blame? (Pick one or all of the ones below)

1. The Lender
2. The REALTOR
3. The Title Company
4. Themselves

I’m betting there will be lots of blame to go around. This is potentially much more dissapointing than a 1/4 point change in an interest rate or a delay in closing, yet too many agents and too many buyers don’t seem to have a sense of urgency about the situation. I hope you don’t end up in that situation. 

(reprinted with permission of the Columbus Board of REALTORS)

With the Fannie Mae and Freddie Mac buyouts, Merrill Lynch and AIG bailouts, the Dow Jones bottom-out and Hurricane Ike blow-out, it can feel like a tough time to buy or sell a home right now.   

There are some factors in your favor however: 

•        Interest rates are as low as they have been for 6 months

•        The FHA has filled the loan void caused by the retrenchment of many banks

•        The Housing and Recovery Act of 2008 gives First-Time Home Buyers a $7,500 tax credit with a 15-year interest free payback

•        The number of active listings is 14% lower than last year at the same time, putting the market into more of an equilibrium

•        Home ownership offers significant tax advantages

Plus, in central Ohio, prices have only slipped 5% from 2007 levels. If you have been putting off your dream home purchase, you won’t find a better time to buy. Compared to the daily gyrations in the stock market, the Columbus housing market is the rock of Gibraltar. If you’re looking for a place to put your money, the housing market is offering the best opportunity in the past ten years!  Ask yourself these questions:

• Will I expect to pay more for a house 2 years from now?

• Do I think interest rates will go up next year to pay for the bailout?

• Do I want to “buy low and sell high”?

If you said Yes to all three questions, this may be the time to look at moving.

Month’s supply & inventory decrease as sales increase

(July 24, 2008) The central Ohio housing market continued to stabilize in June as the area saw it’s lowest “month’s supply” level since last summer, according to the Columbus Board of REALTORS®.  

In June, the month’s supply of homes was 8.03, the lowest since August 2007, and a key indication of the area’s healthy housing market, says Greg Hrabcak, President of the Columbus Board of REALTORS®.  “Month’s supply is the ratio of inventory to sales which takes into account both supply and demand. A healthy market has a 6.5 to 7-month supply of homes, meaning if no new homes were added to the market, it would take about 6.5 or 7 months to sell all the available homes,” says Hrabcak. “The fact that central Ohio’s month’s supply figure is continuing to decrease shows that the market is becoming more balanced. Buyers still have a tremendous selection, but a lower month’s supply also means good news for sellers.”

Although there were slightly more homes on the market in June than in May, year to date totals show a 9.2 percent decrease in total homes on the market this June versus June 2007. Similarly, new listings dropped 13 percent in June compared to June 2007, and nearly seven percent from May to June 2008. “The first half of 2008 has seen steadily increasing home sales,” says Hrabcak. “And there were 8.6 percent more homes sold in June than May.” Year to date sales of new and existing homes through June total 10,667, 14.3 percent behind June 2007’s total of 12,444, but less than six percent behind sales in the market’s pre boom period, during the first half of 2003.  

The average sale price of homes in central Ohio increased over May by more than seven percent in June, to $180,399.

Reprinted with permission of the Columbus Board of Realtors, 7/24/2008

January 2008 Home Sales

Home Sales slower during the holidays

(February 28, 2008) Fewer homes were put into contract at the end of 2007 which resulted in fewer closings in the first month of year. The 1,225 homes sold in January 2008 slipped 18.9 percent from the 1,510 sales in January 2007 - which was 12.2 percent higher than the previous year according to the Columbus Board of REALTORS®.”As closings in January are a direct result of activity and contracts written 30-60 days prior, it comes as no surprise that there was a drop in closings last month,” says Greg Hrabcak, President of the Columbus Board of REALTORS®. “The housing market traditionally experiences less activity beginning around Thanksgiving and into the new year. And REALTORS® had been reporting a higher than normal drop in activity.”"Homes in the $80,000 - $100,000 range, $400,000 - $500,000 and $1 million and over were hardest hit. Each of these price ranges saw decreases in sales in excess of 37 percent,” added Hrabcak.The average sale prices of a home closed during the month of January 2008 was $152,790 compared to $166,096 the previous year. The average sale price in 2007, January through December, was $165,057. “This lower average price goes hand in hand with the sales declines in the higher price ranges,” adds Hrabcak. “When fewer homes are sold in the upper price ranges, the average sale price for the month will decline accordingly. Real estate professionals understand that activity in any single month can fluctuate quite a bit. It’s the direction over a period of time which we focus on.” According to Hrabcak showing activity picked up noticeably in January when interest rates dropped. “Just eight years ago, the average rate for a 30-year fixed rate mortgage was 8.21 percent. Now it’s hovering around six percent. But it won’t last and we encourage anyone interested in buying a home to take advantage of what a lower interest rate means in terms of buying power and building equity.”

Additional StatisticsTo view residential properties for sale, visit www.Realtor.com.

Reprinted with permission of the Columbus Board of Realtors, 2/28/2008

While there has been lots of bad press about depressed housing sales, the facts paint a slightly different picture. Through 9/30/2007, sales in central Ohio were down only 5.4% in number of homes sold. This is coming off a very robust 2006 (the third best year ever). The average selling price is only down 1.1%.

Some areas are enjoying quite a lot of success in unit sales:
West and Northwest Columbus - up 39%
Midtown Columbus - up 10%
Southeast Fairfield County - up 26%
Grandview - up 16%
Indian Lake - up 38%
Buckeye Lake - up 8%
Plain City - up 41%
Marysville - up 15%
Worthington and Riverlea - up 13%

If you are a homeowner that is 65 or older, you can exempt  the first $25,000 of the value of your house from property taxes. The deadline for this year is October 1, 2007 but keep it in mind for next year. The link is tax.ohio.gov and it is under the Homestead link. If you have a question, call the Ohio Dept. of Taxation at 800-282-1780.

Did you know that 30% of homeowners in Upper Arlington are over age 65?

Doug Baker of Dublin City Schools asks that whenever you are talking with a prospective parent about which school their child will attend please refer to this web site http://www.dublinschools.net/Custom/custom.asp?id=142&cmid=1650.  If they need additional information refer them to the building first and then if there are more detailed questions to Edie Carton or Mike Trego at Dublin City Schools Central Office.  Enrollment numbers will be evaluated weekly and if there are any additions to the list, they will be added and posted on the district’s web site each Tuesday.  If a grade level at a specific school building has fewer than 10 available spots, that grade level will be placed on the “Potential Grade Level Caps” list.
Capped Grade Levels:

Any student who enrolls in the first grade at Olde Sawmill Elementary after August 14, 2007 will attend Bailey Elementary.

Any student who enrolls in the second grade at Wyandot Elementary after August 14, 2007 will attend Glacier Ridge Elementary.

Any student who enrolls in the second grade at Indian Run Elementary after August 14, 2007 will attend Thomas Elementary.
Capped Schools:
Eli Pinney Elementary  - Any new families who move into the Eli Pinney attendance area but outside their walk area after March 2, 2007 will be assigned and bussed to Glacier Ridge. This attendance modification is only for new families who move into the area after March 2, 2007.

Riverside Elementary - Any new families who move into the identified area after June 8, 2007 will be assigned to Daniel Wright Elementary School. In addition, all kindergarten students entering school in the 2007/08 school year and beyond in the identified area will be assigned to and bussed to Daniel Wright Elementary School. Each year after the 2007/08 school year, DCS will add a grade level to the reassignment. First graders in 2008/09, second graders in 2009/10, third graders in 2010/11, fourth graders in 2011/12 and fifth graders in 2012/13, completing the transfer of this area from Riverside to the Wright Attendance area.  Any students currently attending Riverside who have younger siblings who are reassigned have the option of following these younger siblings to Daniel Wright. Younger siblings will not be approved to continue at Riverside due to capacity issues.
Potential Grade Level Capping as of September 11, 2007

Bailey Elementary, Third Grade, 5 available positions, Fifth Grade, 1 available position.

Chapman Elementary, First Grade, 9 positions available, Third Grade, 4 positions available.

Deer Run Elementary - Fourth Grade, 9 available positions.

Indian Run Elementary - First Grade, 6 available positions, Third Grade, 7 available positions.

Olde Sawmill Elementary - Fourth Grade, 9 available positions.

Scottish Corners - Kindergarten, 7 available positions, First Grade, 2 available positions, Fifth Grade, 7 available positions

Thomas Elementary - First Grade, 9 available positions, Second Grade, 5 available positions

Wright Elementary - Second Grade,  7 available positions

In spite of all the gloom and doom from the press, interest rates are at very low historical levels. The federal government is likely to take actions to limit foreclosures and pump funds into the market to keep rates low. In addition, 95-100% financing is still available for buyers with a good credit rating.

If you are considering single or multi-family houses as an investment property, be sure to allocate some of the purchase price to land improvements and personal property. The tax savings from faster depreciation can be considerable. The best time to do that is in the purchase contract.

Welcome to Linda and Marty Soller’s Blog! This blog will provide you with valuable information, tips, and general insight into the real estate market in central Ohio.